1974-18 Authorizing Issuance of $4M General Obligation Bonds7 4 '1
ORDINANCE NO. _
AN ORDINANCE of the Kodiak Island Borough, Alaska,
authorizing the issuance of $4,000,000 princi-
pal amount of general obligation refunding
bonds of the borough for the purpose of pro-
viding part of the funds necessary to refund
certain of the borough's outstanding general
obligation bonds; providing and authorizing
the purchase of certain obligations with the
proceeds of the sale of such refunding bonds
and certain moneys in the bond redemption
fund of the borough securing such bonds to he
refunded and for the use and application of the
moneys to be derived from such investments;
providing for the. redemption of the outstanding
bonds to be refunded; providing the date, form,
terms, maturities and covenants of said
refunding bonds to be issued and for unlimited
tax levies to pay the principal thereof and
interest thereon; and confirming the sale
thereof.
WHEREAS, the Kodiak Island Borough, Alaska (hereinafter
called the "Borough "), now has outstanding its general c'hligat on
bonds in the aggregate principal amount of $4,000,000 issued under
date of August 1, 1972 (hereinafter called the "Outstanding Bonds "),
which bonds mature on August 1 in each of the following years in the
following amounts and bear interest as follows:
Interest Interest
Years Amounts Rates Years Amounts Rates
1974 $115,000 6.75% 1984 $210,000 5.70%
1975
1976 120,000 6.75% 1985 225,000 5.80% 1977 130,000 6.75% 1986 240,000 5.908 1978 140,000 6.75% 1987 255,000 6.00%
150,000 6.75% 1988 270,000 6.101
1979 160,000 6.75% 1989 285,000 6.10%
1980 170,000 6.75% 1990 • 300,000 6.10%
1981 180,000 6.75% 1991 320,000 6.10%
1982 190,000 5.60% 1992 340,000 5.501
1983 200,000 5.60%
WHEREAS, the proceedings of the Assembly of the Borough
authorizing the issuance of the 1972 Bonds provide that the Borough
may call such bonds for redemption on August 1, 1982, or on any
interest payment date thereafter, at par plus accrued interest to
date of redemption; and
WHEREAS, after due consideration it appears to this Assembly
that the Outstanding Bonds may be refunded by the issuance and sale
of the general obligation refunding bonds of the Borough authorized
herein (hereinafter called the "Refunding Bonds ") so that a substan-
tial saving to the Borough and its taxpayers will be effected by the
issuance of the Refunding Bonds and the redemption of the Outstanding
Bonds on August 1, 1982; and
WHEREAS, in order to effect such refunding in the manner
that will be most advantageous to the Borough and its taxpayers, it
is hereby found necessary and advisable that certain "Acquired
Obligations" (hereinafter identified), bearing interest and maturing
at such time or times as necessary to pay the principal of and interest
on the Outstanding Bonds as the same shall become due and to so redeem
the Outstanding Bonds, be purchased out of the proceeds of sale of the
Refunding Bonds and moneys in certain bond redemption funds of the
Borough.
NOW, THEREFORE, BE IT RESOLVED by the Assembly of the
Kodiak Island Borough, Alaska, as follows:
Section 1. For the purpose of providing part of the moneys
required to pay the principal of and interest on the Outstanding Bonds
coming due to and including August 1, 1982 and to redeem and retire
on August 1, 1982 the Outstanding Bonds maturing after said date,
the Borough shall issue the Refunding Bonds in the aggregate principal
amount of $4,000,000.
The Refunding Bonds shall be dated April 1, 1974, shall be
in the denomination of $5,000 each, shall be numbered, mature August 1,
and shall bear interest payable semiannually on the first days of
February and August of each year (commencing August 1, 1974) from date
of issue as follows:
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1 1 1 I 2 I 5 '1
Bond Nos.
Years
Amounts Interest Rates
1 -16 1974
17 -42 1975 $130,000 5.00%
43 -70 1976 140' 5.008
100-129 71 -99 1977 145,000 5.0o%
145,000
130 -160
1978 150,000 5.00%
161 -192 1980 155,000 5.00%
194 -227 1981 165,000 5.008
228 -262 1982 170,000 5.258
263 -299 1983 175,000 5.25%
300 -343 1984 185,000 5.25%
344 -390 198 220,000 5.5%
391 -440
1986 235,000 5.25%
441 -493 1987 250,000 5.25%
494 -548 1988 265,000 5.40%
549 -606 19 275,000 5.50%
607 -667 1990 790,000 5.55%
668 -732 19 305,000 5.60%
733 -800 1992 325,000 5.65%
340,000 5.70%
Both principal of and interest on the Refunding Bonds shall
be payable in lawful money of the United States of America at the main
office of Central Bank and Trust Company, Denver, Colorado.
Suction 2. The Borough hereby r ,
Y � ryes the right to redeem
any or all of the Refunding Bonds outstanding in whole, or in part in
inverse numerical order. at t e following • o-
lowing rimes and a t f
the _1:•,aing
prices, expressed as a percentage of the principal amount of bonds to
be redeemed, plus accrued interest to the dace of redemption:
On February 1 and August 1, 1983 at 101
On February 1 and August 1, 1984 at 100 -3/4
On February 1 and August 1, 1985 at 100 -1/2
On February 1 and August 1, 1986 at 100 -1/4
On February 1, 1987 and on any
interest payment date thereafter at 100.
Notice of any such intended redemption shall be given by
one publication thereof in a financial journal of general circulation
in the city of New York, New York, not more than 40 nor less than
30 days prior to such redemption date and by mailing a like notice
at the same time to Marshall and Meyer, Incorporated, at its main
office in Seattle, Washington, and to E. F. Hutton and Company, Inc.
at its main office in Denver, Colorado, or to the successor or suc-
cessors in business of said firms, it any, at its or their main office.
Interest_ on any.Refunding Bond or Bonds so called for redemption shall
cease on such redemption date unless the same are not redeemed upon
presentation made pursuant to such call.
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In addition to such publication and mailing the Borough shall
also mail notice of any such intended redemption to Standard & Poor
Corporation and Moody's Investors Service, Inc., New York, New York,
or to their business successors, if any. The mailing of such notice
shall not, however, be a condition precedent to the call of any of the
Refunding Bonds for redemption, 'and failure to give such notice shall
not affect the right of the Borough to redeem the Refunding Bonds called
for redemption in the manner set forth in the preceding paragraph.
Section 3. The Refunding Bonds shall be in substantially
the following form:
NO.
r, 2
UNITED STATES OF AM•IERICA
STATE OF ALASKA S5,000
KODIAK ISLAND BOROUGH
GENERAL OBLIGATION REFUNDING BOND, 1974
The Kodiak Island Borough, Alaska (hereinafter called
i-he "Rory t, , ") , hPrphy ackr.nwledgea itself to owe and for
value received promises to pay to bearer on the first day
of August, 19, the principal amount of
FIVE THOUSAND DOLLARS
together with interest thereon at the rate of % per annum
payable on the first days of February and August of each
year
from date of issue (commencing August 1, 1974) upon presentation
and surrender of the attached interest coupons as they severally
become due. Both principal of and interest on this bond are
payable in lawful money of the United States of America at the
main office of Central Bank and Trust Company, Denver, Colorado.
The Borough has reserved the right to redeem any or all
of the outstanding bonds of this issue in whole, or in part
in inverse numerical order, at the following times and at the
following prices, expressed as a percentage of the principal
amount of bonds to be redeemed, plus accrued interest to the date
of redemption:
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On February
On February
On February
On February
On February
interest
1983 at 101
1984 at 100 -3/4
1985 at 100 -1/2
1986 at 100 -1/4
any
ereafter at 100.
1 and August 1,
1 and August 1,
1 and August 1,
1 and August 1,
1, 1987 and on
payment date th
Notice of any such intended redemption shall be given
by one publication thereof in a financial journal of general
circulation in the city of New York, New York, not nore than
40 nor less than 30 days prior to such redemption date and
by mailing a like notice at the same time to Marshall and
Meyer, Incorporated, at its main office in Seattle, Washington,
and to E. F. Hutton & Company, Inc., at its main office in
Denver, Colorado, or to the successor or successors in business
of said firms, if any, at its or their main office. Interest
on any bond or bonds so called for redemption shall cease on
such redemption date unless the same are not redeemed upon
t1
presentation made pursuant to such call.
This bond is one of an issue of 800 bonds of like amount,
date and tenor except as to number, rate of interest and date
of maturity in the aggregate principal amount of $4,000,000,
which bonds are issued for the purpose of providing part of
the moneys necessary to refund outstanding general obligation
bonds of the Borough in the principal amount of $4,000,000.
The bonds of this
in accordance with the
applicable statutes of
refunding issue are issued under and
provisions of the'Constitution and
the State of Alaska and ordinances
duly passed by the Borough Assembly.
The Borough hereby irrevocably covenants that it will
levy taxes annually upon all the taxable property in the
Borough without limitation az to rate or amount and in
amounts sufficient, with other moneys legally available
therefor, to pay the principal or and interest on the bonds
of this issue as the same shall become due. The full faith,
credit and resources of the Borough are hereby irrevocably
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ATTEST:
}
Borough Clerk
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pledged for the annual levy and collection of such taxes
and the prompt payment of such principal and interest.
It is hereby certified that all acts, conditions and
things required to be done precedent to and in the issuance
of this bond have happened, been done and performed and
that the total indebtedness of the Borough, including this
bond and the bonds of this issue, does not exceed any consti-
tutional or staturory limitation.
IN WITNESS WHEREOF, Kodiak Island Borough, Alaska, has
caused this bond to be signed by the Mayor of the Borough,
to be attested by its Clerk, the seal of the Borough to be
impressed hereon and the interest coupons attached hereto to
be signed with the facsimile signatures of said officials
this first day of April, 1974.
KODIAK ISLAND BOROUGH, ALASKA
By l �: �'�;,.1 L L am. "�
Borough Mayor
The interest coupons attached to the Refunding Bonds
shall be in substantially the following form:
NO. $5,000
r
On the first day of , 19 the Kodiak
Island Borough, Alaska, will pay to bearer at the main office
of Central Bank and Trust Company, Denver, Colorado, the
amount shown hereon in lawful money of the United States of
America, said amount being the interest due that date on its
general obligation refunding bond dated April 1, 1974, and
• numbered
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1 1 a , 2'1 ;
ATTEST:
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KODIAK ISLAND BOROUGH, ALASKA
By 11)
8 rough Mayor
Borough Clerk
Section 4. The Refunding Bonds shall be signed in the
corporate name of the Borough by the Borough Mayor and the
Borough Clerk. Each of the interest coupons attached thereto
shall be signed with the facsimile signatures of said officials.
Section 5. The Borough hereby irrevocably covenants that
for as long as any of the Refunding Bonds are outstanding it
will make annual levies of ad valorem taxes without limitation
as to rate or amount. upon all the property within the Borough
subject to taxation which, with other moneys legally available
t will be su :icient iil dltNUllt t0 d
p�y the principal of
and interest on the Refunding Bonds as the same shall become
due. The full faith, credit and resources of the Borough are
hereby irrevocably pledged for the annual levy and collection
of such taxes and for the prompt payment of such principal and
interest.
Section 6. There has heretofore been created a special
fund of the Borough known as the "1972 Bond Redemption Fund"
(hereinafter called the "1972 Fund "), which Fund is to be
drawn upon for the sole purpose of paying the principal of and
interest on the Outstanding Bonds.
The proceeds cf sale of the Refunding Bonds (exclusive of
1974 General Obligation Bond Redemption Fund hereinafter
created) shall be credited to such Fund and used immediately
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upon the receipt thereof to discharge the obligations of the
Borough under Ordinance 72 -7 -0 of the Borough authorizing the
issuance of the Outstanding Bonds by providing for the paymc.nt
as hereinafter set forth in this section of the principal of
and interest on the Outstanding Bonds. The Borough shall
discharge such obligations by the use of moneys now held in the
1972 Fund (in an amount not greater than the interest accruing
on the Outstanding Bonds from their last interest payment date
to the date of delivery of the Refunding Bonds to the initial
purchaser thereof), and by the purchase of certain obligations
of the United States government, or agencies thereof, ( "Acquired
Obligations), bearing such interest and maturing as to principal
and interest in such amounts and at such times so as to provide
for the payment of:
.(a) Interest on the Outstanding Bonds which will become
due and payable on or before August 1, 1982.
(b) The principal of the Outstanding Bonds which will
mature on or before August 1, 1982.
(c) The redemption price payable on August 1, 1982 for
the principal of the Outstanding Bonds maturing after that date.
Such Acquired Obligations are set forth in Schedule A -1
attached to this Ordinance and incorporated by reference herein.
Such Acquired Obligations shall be purchased at a yield not greater
than 5.4468% per annum; provided, however, that a sum not greater
than $ 666,685.62 may be used to acquire Acquired Obligations at
the current market price.
Such money and Acquired Obligations shall be irrevocably
deposited with Seattle -First National Bank, Seattle, Washington,
(hereinafter called the "Refunding Agent "). Any amounts described
in subparagraphs (a) through (c) of this section which are not
provided for in full by such money and the purchase and deposit
of Acquired Obligations described in this section shall be provided
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for by the irrevocable deposit of the necessary amount out of the
proceeds of sale of the Refunding Bonds or any other moneys of
the Borough legally available therefor with the aforesaid Refunding
Agent.
Section 7. The Borough hereby - "' -- irrevocably calls for
redemption on August 1, 1982 the Outstanding Bonds maturing after
such date in accordance with the provisions of Ordinance No .
of the Borough authorizing the redemption and retirement of the
Outstanding Bonds prior to their fixed maturities.
Said call for redemption shall he irrevocable after the
delivery of the Refunding Bonds to the initial purchasers thereof.
The Refunding Agent, acting in concert with the Borough
Clerk, is hereby authorized and directed to provide for the giving
of notice of the redemption of the Outstanding Bonds in accordance
with the applicable provisions of said ordinance.
The Refunding Agent is hereby authorized and directed to
pay to the Borough Clerk, or, at the direction of the Clerk, to the
paying agents for the Outstanding Bonds, sums sufficient to pay, when
due, the sums specified in subparagraphs (a) through (c) of Section 6
of this Ordinance. All such sums shall be paid from the moneys and
Acquired Obligations deposited with said Refunding Agent pursuant to
the previous section of this ordinance, and the income therefrom and
proceeds thereof. All moneys and Acquired Obligations deposited with
said Refunding Agent and any income thereofrom shall be deemed assets
of the 1972 Fund and shall be held, invested (but only at the direction
of the Borough Clerk) and applied in accordance with the provisions of
this ordinance and with the laws of the State of Alaska for the benefit
of the Borough and the holders of the Outstanding Bonds. All monies
held by the Refunding Agent pursuant to this ordinance, after August 1,
1982, shall be paid to the Borough.
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Section 9.
In
the event
-
The Borough will take such actions as are found necessary
to see that all necessary and proper fees, compensation and expenses
of the Refunding Agent for the Outstanding Bonds shall be paid when
due. The proper officers and agents of the Borough are directed to
obtain from the Refunding Agent an agreement setting forth the duties,
obligations and responsibilities of the Refunding Agent in connection
with the redemption and retirement of the Outstanding Bonds as provided
herein and stating that such provisions for the payment of the fens,
compensation and expenses of such Refunding Agent are satisfactory to it.
In order to carry out the purposes of the preceding section
of this ordinance and this section, the Borough Mayor and Clerk are
authorized and directed to execute and deliver to Seattle -First National
Bank, Seattle, Washington, a copy of such agreement when the provisions
of it have been fixed and determined. Such agreement, when finally
executed, shall be marked "Exhibit A ", shall be attached to this
ordinance and by this reference thereto is hereby made a part of this
ordinance.
Section 8. There is hereby created a special fund of the
Borough to be known as the "1974
Fund," which fund shall be drawn
the principal of and interest on
General Obligation Bond Redemption
upon for the sole purpose of paying
the Refunding Bonds as the same shall
become due. All accrued interest received from the sale of the
Refunding Bonds shall be paid into the 1974 General Obligation Bond
Redemption Fund.
that money and /or direct obligations
of the united States of America, and /or obligations guaranteed by the
United States of America, maturing at such time or times and bearing
interest to be earned thereon in amounts (together with such money,
if necessary) sufficient to redeem and retire the Refunding Bonds in
accordance with their terms, are set aside in the 1974 General Obliga-
tion Bond Redemption Fund of the Borough to effect such redemption and
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retirement, and such moneys and the principal of and interest on such
obligations are irrevocably set aside and pledged for such purpose,
then no further payments need be made into the 1974 General Obligz
Bond Redemption Fund for the payment of the principal of and interest
on the Refunding Bonds, and the Refunding Bonds and the coupons
appurtenant thereto shall cease to be entitled to any lien, benefit
or security of this ordinance except the right to receive the moneys
so set aside and pledged, and the Refunding Bonds and such coupons shal.
be deemed not to be outstanding hereunder.
Section 10. The Borough hereby covenants that it will not
make any use of the proceeds of sale of the Refunding Bonds and any
other funds of the Borough which may be deemed to be proceeds of such
Refunding Bonds pursuant to Section 103(d) of the Internal Revenue
Code and the applicable Regulations thereunder which, if such use
had been reasonably expected on the date of delivery of the Refunding
Bonds to the initial purchasers thereof, would have caused the
Refunding Bonds to be 'arbitrage bonds' within the meaning of said
section and said regulations. The Borough will comply with the
requirements of subsection (d) of Section 103 of the Internal Revenue
Code and the applicable regulations thereunder throughout the term of
the Refunding Bonds.
This Assembly hereby finds and determines that the issuance
and sale of the Refunding Bonds at this time will effect a saving to
the Borough and its taxpayers. In making such finding and determina-
tion this Assembly has given consideration to the interest to the
fixed maturities of the Refunding Bonds and'the Outstanding Bonds
being refunded, the costs of the issuance of the Refunding Bonds and
the known earned income from -the investment of the proceeds of sale
of the Refunding Bonds pending redemption of the Outstanding Bonds.
This Assembly hereby further finds and determines that the
moneys and Acquired Obligations to be deposited with the Refunding
1
Agent for the Outstanding Bonds in accordance with Section 6 of this
resolution will discharge and satisfy the obligations of the Borough
under Ordinance No. 72 -7 -0 authorizing the issuance of the Outstanding
Bonds and the pledges, charges, trust, covenants and agreements of the
Borough therein made or provided for as to said Outstanding Bonds,
and that said Outstanding Bonds shall no longer be deemed to be
outstanding under said ordinance immediately upon the deposit of
such moneys and the Acquired Obligations with the Refunding Agent.
Section 11. The written offer of E. F. Hutton & Company,
Inc. and Marshall and Meyer, Incorporated, dated' March 1, 1974, to
purchase the Refunding Bonds at the price specified in such offer,
and under the terms and conditions thereof as provided in said offer
and in this ordinance is hereby in all respects accepted and confirmed.
The proper Borough officials are hereby authorized and
directed to do everything necessary for the prompt execution and
delivery of the Refunding Bonds to said purchaser and for the proper
application and use of the proceeds of sale thereof.
Section 12. If any one or more of the covenants or
agreements provided in this ordinance to be performed on the part
of the Borough shall be declared by any court of competent jurisdiction
to be contrary to law, then such covenant or covenants, agreement or
agreements, shall be null and void and shall be deemed seperable from
the remaining covenants and agreements in this ordinance and shall in
no way affect the validity of the other provisions of this ordinance
or of the Bonds.
Section 13. This ordinance shall become effective immedi-
ately upon its passage.
ADOPTED by the Assembly of the Kodiak Island Borough, Alaska,
at a regular meeting thereof held this day ofpj/ , 1974.
KODIAK ISLAND BOROUGH, ALASKA
By C
Presiding Officer
,1
1.1x/.4.4/ orough Mayor
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ATTEST:
• >
Borough Clerk
Amount
CODE:
SCHEDULE A -1
ACQUIRED OBLIGATIONS
KODIAK ISLAND BOROUGH, ALASKA
SECURITIES USED TO FUND ESCROW
Interest
Rate
Description
$2,810,000 6.650% FNMA 6/10/82
4,000 7.000% BOND 8/15/81
160,000 7.250% FNMA 6/10/81
151,000 7.500% FLB 7/21/80
141,000 7.150% FLB 7/23/79
132,000 6.250% NOTE 2/15/78
123,000 7.500% FLB 7/20/77
115,000 6.500% NOTE 5/15/76
106,000 6.000% NOTE 5/15/75
112,000 7.250% NOTE 5/15/74
FNMA - Federal National Mortgage Association Debenture
BOND - United States Treasury Bonds
FLB - Federal Land Bank Bonds
NOTE - United States Treasury Notes
•
Maturity
Date
1
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1 2 4 4 n
Norma L. Holt , Clerk of Kodiak Island
Borough, Alaska, DO HEREBY CERTIFY that the foregoing is a true and
correct copy of Ordinance No. 74 -18 -0 of said Borough, duly adoptod
by the Borough Assembly and approved by its Mayor at a regular
meeting of said Assembly held on the 2 7th day of April
1974.
Borough Cler